What is a Blockchain Contract?
Exciting things are happening in the business world due to the emergence of blockchain technology. Blockchain opens up possibilities for a new, collaborative and individually empowering means of doing business without borders and without the need for regulatory organisations or other intermediaries.
Blockchain empowers people in two ways that have up to now not existed — a) the ability to legitimize innovation and new products without seeking approval from governments and b) the ability to create financial assets out of non-profit based transactions. If a cause has followers, it can be funded very easily on blockchain in ways which are normally unfundable in a government-based legal regime. For instance, on blockchain, ten people could create their own bank without seeking a license from the government. In a central bank-dominated banking system, a bank cannot exist unless approved by the central bank. Another new possibility, a financial asset can be created out of a social cause and the gains from that financial asset can be designated to fund that social cause as long as enough people support the cause. In a non-blockchain world, only donations and charities can fund a social cause whereas in the blockchain world a social cause can be funded by profit-seeking behaviour in addition to donations and charity.
A blockchain is of no use until it can get people to cooperate toward a common cause. That common cause has to be expressed in terms of obligations and benefits of all parties involved in the cause. Obligations are what the parties perform and benefits are what the parties gain as a result of their performance. Blockchain Contracts are an expression of obligations and benefits of all parties involved, as written on the blockchain. Another way of looking at it is that blockchain is a technology and a Blockchain Contract is the human application of that technology. Blockchains are useless without Blockchain Contracts. Human innovation in blockchain is at most a technological innovation, but human innovation in Blockchain Contracts is a social innovation which can transform human lives. When we speak about blockchains being revolutionary, it is the Blockchain Contracts, rather than blockchains themselves which are the cause of the revolutionary transformation. That is the reason why focusing on Blockchain Contracts rather than blockchains would yield greater dividends for mankind. This is why Blockchain Contracts are the core pillar of Ranchi Mall’s efforts and innovations.
The current way of putting business agreements onto the blockchain is called a smart contract for which all the decisions, once coded by the contract creators, are automatically implemented by software. Blockchain Contracts, on the other hand, assign a primary role to human judgment in blockchain-based contract decisions. Human judgments are superior to machine judgments in matters of unexpected events that can occur during the course of a contract. As a result, Blockchain Contracts perform much better than Smart Contracts in real world scenarios where uncertainties exist.
The emergence of blockchain technology has paved the way to redefine all economic relationships, some of which will have social impact. Blockchain is an internet space where interested individuals from all over the world can agree upon a course of action and then fund it. The funding is done primarily with the interest of having higher future valuations to their financial interests. The financial interests of each of the involved parties is tradable in the group. This tradability creates the economic value behind the blockchain contract. Since the space of collaboration is not limited to a country, the overall financial might of blockchain contracts can be greater than economic mights of countries.